The problem is that it is too radical a ticket.
It would unite the GOP and most independents against it.
Moreover, I don't think the white rural voters are going to vote for Obama, no matter who the VP is.
Finally, having Hillary on the ticket takes away Obama's main theme, running as an outsider.
If Obama needed to make a deal with Hillary, it might happen, but now, he doesn't need to.
She can run all she wants she can't catch him.